Energold Drilling

EGD has the ability to be the fastest growing company in a sector that is experiencing a once in a lifetime secular bull market of epic proportions....

- EGD has strong balance sheet, capital discipline, a permanent cost advantage over competition, a capital light operation with a variable cost structure and Fred Davidson, the best CEO in the industry
- Man portable rigs are both environmentally friendly and allow drilling in remote areas
- 2011 total exploration spending by base and precious metals producers - $14 billion
- Junior miners raised £12 billion last year for gold related projects, so 2012E spending should improve.
- Firm and stable spending, high, rising commodity prices, declining reserves, cash rich major & junior miners
- 50% of total industry spend will go towards gold exploration
- Frontier drilling, EGD's specialty, has been declining but is now stabilising
- EGD is the low cost producer in the sector and will get a growing share of a growing sector.
- Frontier drilling demand should overwhelm supply, leading to strong demand and pricing power for EGD
- Expect strong growth in volume and pricing for existing and new rigs
- EGD is the sole source provider of man-portable rigs; competition is non-exitent and likely to stay that way
- 80% of crews are locals; company reinvests 1-2% of revenues in local community projects each year
- Excellent money printing hedge
- Low valuation, misinterpreted by the market as EGD amortises newly acquired rigs aggressively, meaning earnings are under-reported during times of high growth. EGD has grown rigs at 30% CAGR historically.
- EGD trading at 5x normalised EPS with very strong future EPS growth rate


http://beforeitsnews.com/story/929/941/Energold_Drilling_EGD_CN.html